Banner ad

Monday, September 12, 2011

Cruising the Web

Robert Samuelson delivers a refresher course on why we haven't seen jobs returning after the massive stimulus bill of 2009. People have little confidence in the economy and so both companies and individuals have increased savings so they'll be protected if the economy continues in its sour state.
Start with Obama. He has run two parallel administrations, pretending he could pursue separate jobs and social agendas as if they were unrelated. His health-care "reform," by requiring employer-paid insurance, will raise employment costs. Did he really think this wouldn't affect the profitability of hiring? (See Condition Two above.) Many Obama policies frustrate job creation.

Switch to Capitol Hill. It's more of the same. Republicans and Democrats exult in vitriolic attacks on each other. Their pleasure from mutual vilification comes at the public cost of lower confidence. By contributing to this, the disarray over long-term deficits also undermines employment.

Steven Hayward explains
how Obama is like FDR by revisiting the memoirs of Raymond Moley, one of FDR's speechwriters whose description of FDR's mistakes sounds remarkably like what Robert Samuelson wrote in his column today.
The first [of FDR’s mistakes] centered in a failure to understand what is called, for lack of a better term, business confidence. Confidence consists, on the one side, of belief in the prospect of profits and, on the other, in the willingness to take risks, to venture money. . .This Roosevelt refused to recognize. In fact, the term “confidence” became, as time went on, the most irritating of all symbols to him. He had the habit of repelling the suggestion that he was impairing confidence the public had lost in business leadership . . . For one thing, the confusion of the administration’s utility, shipping, railroad, and housing policies had discouraged the small individual investor. For another, the administration’s taxes on corporate surpluses and capital gains, suggesting, as they did, the belief that a recovery based upon capital investment is unsound, discouraged the expansion of producers’ capital equipment.

For another, the administration’s failure to see the narrow margin of profit on which business success rests—a failure expressed in an emphasis on prices while the effects of increases in operating costs were overlooked—laid a heavy hand upon business prospects. For another, the calling of names in political speeches and the vague, veiled threats of punitive action all tore the fragile texture of credit and confidence upon which the very existence of business depends.
Gosh, doesn't that sound familiar?
Michael Barone reviews what Obama's speech to Congress revealed - and his observations all begin with the letter P.
Projection. That's psychologist-speak term for projecting your own faults on others. "This isn't political grandstanding," Obama told members of Congress, as Republicans snickered (but thankfully resisted the temptation to shout, "You lie!"). "This isn't class warfare."

These sentences came four paragraphs after Obama insisted that "the most affluent citizens and corporations" should pay more taxes (which spurs job creation how?) and not long before he promised to "take that message to every corner of the country."

Lest there be an doubt about Obama's real intentions, consider that his speech was obviously modeled on Harry Truman's call for a special session of the Republican Congress in the summer of 1948 so he could campaign against it.
From there he goes on to talk about Pragmatism, Pathetic promises, Political payoffs, and Pettifoggery. Yup, it was all there.

The WSJ chides both Rick Perry and Mitt Romney
for the way they've been using Social Security in their campaigns. They should both address how they'd reform the program.

And here is a reminder of why we need to reform all our entitlement programs. Without reform they will, in a few decades, account for all of the revenues our government takes in.
This is a chart that our candidates should be showing Perot-like in their speeches and ads.

Robert Tracinski has a great column about how government is precisely the wrong entity to be delivering innovation and picking economic winners and losers. he calls Obama, our Post Office President, who is spending our money to preserve a model of the past that is failing and will continue to fail because bureaucrats and politicians aren't the ones who deliver the new products and services that the economy of the future will demand. He mentions how the federal government blocked the merger of Blockbuster and Hollywood Video because they would be too big and dominate the market in VHS rentals. The government didn't foresee the growing role of Netflix. And now Netflix has to compete with video streaming. Times change. Business evolve or perish. Politicians should stay out of this natural development.
The pace of commercial and technological innovation is not news. It is a daily reality that we take for granted. But the story underneath it is what politicians like Barack Obama refuse to acknowledge, and it is what makes all of their fake jobs programs and "infrastructure banks" so futile and destructive.

What they refuse to grasp is the root of America's dynamism: the endless creativity of the individual human mind when it is left free to innovate. The government does not need to intervene to get people to come up with new ideas or to encourage entrepreneurs to grow and become successful. It only needs to get out of the way.

When, instead, geniuses like Barack Obama decided they are going to use the power of government to impose their ideas and grow only the kinds of enterprises they favor, the result is not brisk innovation but the dead hand of static ideas. That is the lesson of the government's failed experiment with solar panel maker Solyndra, which President Obama touted last year as the wave of the future, and whose technology was rendered obsolete before they even finished building their gleaming new factory backed by $600 million in federal loan guarantees. And it's not just Solyndra. The whole solar and "alternative" energy sector is crashing. These companies were not profitable and have not become profitable. The moment government subsidies and loan guarantees evaporate, so do they.

So much for Obama's career as a high-tech venture capitalist. Too bad the money he's risking is ours.
Kenneth Pollack explains why Obama's plan to leave only about 3,000 U.S. troops in Iraq after this year is so very dangerous.
This is where the idea of leaving only a few thousand U.S. troops in place goes from perplexing to potentially dangerous. A force that small will have a very hard time protecting itself, let alone other American personnel in Iraq. They will have to remain on a small number of forward operating bases that are well known to Iraq's myriad terrorist groups, who will continue to attack them for a variety of emotional and political reasons. But our troops will not have all of the intelligence assets that they have enjoyed in the past to identify potential threats; the special-forces capabilities to pre-empt attacks; the heavy weapons to quickly respond to attacks; or the assets to track down the perpetrators of an attack and catch or kill them.

Force protection, which had become almost a non-issue by 2010, has already resurfaced as a problem after the reduction to 46,000 troops late last year. If not for the Herculean efforts of the U.S. military command in Baghdad this summer to convince the Iraqi government to take protecting U.S. troops seriously, the soldiers might already be in an untenable position—and with 15 times the number of troops that future plans call for. With only a few thousand troops left in Iraq, and the U.S. military lacking the weight to press Baghdad to do the right thing, force protection could become impossible.

There is another problem. As we have seen recently during violent protests in Bahrain, when American military personnel are present in a country, the U.S. is seen as responsible for developments there. No matter how tiny a U.S. force remains in Iraq, the perception in the Arab world will be that the Americans are in charge behind the scenes. Any problematic actions undertaken by whatever Iraqi faction is in government against its rivals—a common problem that has plagued Iraq and is the surest way to reignite civil war—will be perceived as having Washington's backing. The fact that we will have little ability to affect the situation will be lost on Iraqis, who will see complicity, not impotence.
With all these problems, the question is why keep any troops there? If Obama is going risk what has been gained there, why endanger the lives of those few troops left?

Jonathan Last surveys the President's strange passivity. Over and over again he has seemed to embrace his sidelines role.
What makes President Obama’s executive passivity so interesting is that it seems to be a symptom not of policy uncertainty, but of personal narcissism. The president is free to delegate the tasks of the president because he’s already done the important job of simply showing up. It’s the same impulse that leads him to make all sorts of claims about the singularity of his tenure. For instance, at an August 15 town hall event in Minnesota, he boasted that after his administration took control of General Motors and Chrysler, the two companies posted profits for the “first time in decades,” even though both companies were profitable as recently as 2004....n his postelection press conference that month, Obama complained that one of the problems his party has is that Americans don’t get to see him doing the hard work of being president. For instance, he mentioned that he reads letters from ordinary Americans all the time:
Those letters that I read every night, some of them just break my heart. Some of them provide me encouragement and inspiration. But nobody is filming me reading those letters. And so it’s hard, I think, for people to get a sense of, well, how is he taking in all this information?
It was good of the president to let voters off the hook for not understanding how hard he works on their behalf. And he didn’t have to do that. Especially since, back in August 2009, the White House did film him sitting up late at night reading letters from Ordinary Americans. They even posted the video on the White House website and YouTube.
As Last points out, Bill Clinton was frustrated that he hadn't had a true crisis or a war to confront during his presidency so that he could climb into the first tier of presidents.
Bill Clinton’s vanity was that he wished he could have been at the center of a world historical event. Barack Obama’s vanity is that he believes he is a world historical event. And the greatness of his being dwarfs any necessity to establish greatness through action. That’s why, despite his passivity as president, we’re likely to see a much more vigorous Obama in the coming months as he switches from governing to campaigning. However ambivalent he may be about leading the country, arguing for the indispensability of Barack Obama is the one project that has always commanded his full attention.
Mary Anastasia O'Grady contrasts Obama's jobs-killing policies to how Canada has weathered the recession and come back with strong jobs growth because they have taken the exact opposite approach to developing their natural resources. Yet Obama doesn't grasp the way that his policies have stifled that same jobs growth that could be taking place in our country.

Ross Douhat reminds us of how everything the Democrats did in their stimulus bill ran contrary to the good advice that Alice Rivlin gave them back in 2009 before they passed their program.
The first warning was about the design of the stimulus. The ideal anti-recession package, Rivlin told Congress, would include aid to state governments, extended unemployment benefits, money for genuinely “shovel ready” projects and a payroll tax holiday. But she urged Congress to resist the temptation to combine these kinds of short-term recession-fighting measures with a larger and more costly investment in energy, education and infrastructure. Trying to rush a long-term spending package through in an atmosphere of crisis, she cautioned, would only guarantee that its contents would be poorly designed, and much of its spending wasted.

The second warning was about setting expectations. Given the nature of the financial crisis and the nasty overhang of debt it left behind, any recovery would probably be slow even with a stimulus bill. Policy makers “should be skeptical of all forecasts,” she told Congress, “and especially conscious of the risk that things may continue to go worse than expected.”

The third warning was about how to handle the problem of deficits, which already shadowed the stimulus debate. “We do not have the luxury of waiting until the economy recovers before taking actions to bring down projected future deficits,” Rivlin said. Instead, she urged Congress to take action “this year” on entitlement spending, and to prioritize Medicare reforms over a more comprehensive health care overhaul.
They totally ignored that advice. The results are what we're enduring now. The question is, does Obama deserve our confidence and trust as he asks for a do-over without admitting the mistakes he's made since he came to office?

No comments: